Mitch Allen, an Entrepreneurs' Organization (EO) member in Fort Worth, Texas, is founder and Head Elf of Hire Santa, a service that brings the season to life with thousands of professionally trained Santas worldwide. On December 2, 2018, Mitch pitched his company on ABC's Shark Tank. We asked Mitch about this once-in-a-lifetime experience. Here's what he shared.
How did your appearance on Shark Tank come about?
I'm a fan who always dreamed of being on the show--it's like the Super Bowl for entrepreneurs. In January 2018, I checked the audition schedule and saw an open call the following week in Dallas. I downloaded the forms, came up with a one-minute pitch and stood in line all day with 500 other hopefuls.
I delivered my pitch to one of the six casting associates and thought I connected with him. The fact that I had revenue, a fun service and an interesting story played in my favor. Throughout the process, we were told not to expect a callback, so I was excited when they called less than a week later and sent contracts and extensive nondisclosure agreements.
They asked for a 10-minute audition video, so I gathered 10 local Santas and a Mrs. Claus and made one. When I sent it, they repeated, "Only a small percentage of people get callbacks. Don't get your hopes up."
Shortly after that, our company won a huge nationwide contract, so I was focused on that when the producers called to say that I was moving on to the next round: filming with the sharks. They assigned two producers to help me; we had weekly conference calls to hone my pitch and get my financial documents in order.
Being an EO member was incredibly helpful: My fellow members encouraged me and helped me practice, practice, practice. I made four mock Shark Tank presentations, where EO members asked tough questions and challenged my negotiation skills. Being well-prepared helped me remain calm under pressure.
When I landed in Los Angeles to film in September, the EO chapter there organized one last run-through. Two of my Fort Worth colleagues appeared onstage with me as a snowman and Rudolph. EO members offered an extraordinary level of support, both before, during and after the filming.
What was the biggest surprise about your experience?
I was surprised that entrepreneurs who appear on the show pay for their own set and props--there's no stipend or budget from the show.
Also, after you walk down the hall and arrive in front of the Sharks, you stand for up to a minute in silence, waiting for the cameras to get set. Had I not known that in advance, it would have been very intimidating.
Any behind-the-scenes information to share?
- The set is huge! On TV it looks conference-room-sized, but it's enormous--and two stories tall.
- Everything is filmed live with no second takes or do-overs.
- The Sharks aren't briefed in advance about the entrepreneurs or businesses, so your pitch better explain everything you want them to know.
- About 40,000 people apply each season; about 100 make it on air.
- The show puts you up at a hotel with other entrepreneurs who are filming the same week. It made for fascinating conversations. Some were very prepared, others were still practicing and seemed nervous. Some wanted to talk, others were very secretive.
- The filming took 45 minutes, which was edited into a nine-minute segment.
Did you make a deal with one of the Sharks?
I asked for $200,000 in exchange for 10 percent of the company. Four of the five Sharks went out fairly quickly, citing seasonality concerns.
Kevin O'Leary made an offer. We couldn't agree on business valuation. At one point, I was 30 seconds from walking away without a deal. I've taken courses on negotiation, so I tried to control the room and not be intimidated or overwhelmed.
I countered O'Leary with the option of splitting the profits until he got his investment back, which turned out to be the right move. When Daymond John started negotiating opposite O'Leary, my goal was to play them against each other to get a better deal.
In the end, as John tried to steal the deal from O'Leary, Barbara Corcoran swooped in and clinched it: She'll get 50 percent of profits until she recoups her $200,000 investment and will own 10 percent of the company.
With the cash infusion, Corcoran's help and exposure from the show, we'll be able to grow and scale at an accelerated rate. I couldn't be happier!
Any tips for entrepreneurs who want to be on Shark Tank?
- Don't overthink it. Prepare your one-minute pitch, go to an open audition?and nail it. The only way you'll ever get on the show is to try. Do it!
- Focus on entertainment value. The producers were ecstatic that I wanted to bring 20 Santas onto the set. Make your pitch both entertaining and a good investment.
- Know your numbers. Decide exactly what level deal you will and won't take. Explore a variety of deal structures so you can counter intelligently.
- Overprepare. Practice pitching and negotiating with different groups of people. Even though I felt well-prepared, I couldn't have predicted the outcome. Practice helped me perform at the critical moment.
- Know your Sharks. Each Shark has different businesses, specialties and preferences. Some have been burned in the past. Watch every episode, take notes and research!
- Reach out to people who've been on the show. You'll be surprised how valuable their experiences will be in preparing for your own.
- Enjoy yourself and have fun. The day we filmed is probably one of the top days of my life, the culmination of lifelong learning and growing. I'm so glad I went for it!